There are five Internet companies—Apple, Google, Microsoft, Amazon and Facebook. Together they have a market capitalization just under 3 trillion dollars.

Bruce Schneier has called this arrangement the feudal Internet. Part of this concentration is due to network effects, but a lot of it is driven by the problem of security. If you want to work online with any measure of convenience and safety, you must choose a feudal lord who is big enough to protect you.

Google and Facebook are on their way to a duopoly in online advertising. Over half of the revenue in that lucrative ($70B+) industry goes to them, and the two companies between them are capturing all of the growth (16% a year).

Apple and Microsoft have a duopoly in desktop operating systems. The balance is something like nine to one in favor of Windows, not counting the three or four people who use Linux on the desktop, all of whom are probably at this conference.

That is the state of the feudal Internet, leaving aside the court jester, Twitter, who plays an important but ancillary role as a kind of worldwide chat room. [1]

There is a difference between the giant Silicon Valley companies and Goldman Sachs, Citicorp and the big Wall Street banks. The Silicon Valley companies have created value. The Wall Street banks, by and large, have destroyed wealth.

I depend on Google; I found Ceglowski’s talk through Google Search. I use Apple products; I’m typing this post on my i-Mac. I don’t use Facebook or Windows, but many of my friends do. I try to avoid ordering books through Amazon, because I disapprove of the way Jeff Bezostreats Amazon employees and small book publishers, but I use subscribe to Amazon Prime.

I don’t deny the achievements of the founders of these companies, nor begrudge them wealth and honor. But I do not think that they or their successors have the right to rule over me, and that’s what their monopoly power gives them.